India needs to edge towards Australia to counter Chinese threat

It’s not just the US-China tariff standoff that has India interested. Delhi is also keeping a close watch on ‘Down Under’ at the flip-flop surrounding China-Australia relations. Relations between Beijing and Canberra had soured last year when Australian Prime Minister Malcolm Turnbull had accused China of ‘espionage’ and ‘interfering in its internal affairs’. Beijing angrily denied the allegations and relations sunk to a new low. Recently, conciliatory statements by both sides has caused tempers to cool.

Relations between China and Australia should especially interest India because so far the country has been a key partner in a bid to counter’s Beijing’s growing influence. In July, Australia, Japan and the US looked to create a scheme to invest in countries across Asia and the Pacific. The scheme was seen by analysts as an answer to China’s Belt and Road Initiative (BRI) and a bid to curb Beijing’s growing influence. Also, Australia is seen as a key member of the Quadrilateral (QUAD) project. This project which includes Delhi, Tokyo, Washington and Canberra is again seen as a bid to counter Beijing. But India’s decision to exclude the Australian Navy from multilateral naval exercises held in Guam in June has apparently not gone down well with Canberra. It is believed that Chinese pressure and a bid to thaw ties with Beijing post-Doklam was behind Delhi’s decision.

As a result, the recent conciliatory words between China and Australia need to be watched all the more closely by both India and the US. It is also worth noting here that despite the war of words between the two countries, Australia is highly dependent on China for trade. Currently, Chinese government statistics show that China is Australia’s largest trade partner for goods and services and this two-way partnership amounted to $131.6 billion dollars and accounted for 23.8 per cent of Australia’s total trade in 2016-17. Also, Chinese students comprise 38 per cent of foreign students in Australia, the largest to that country. It is safe to say that China has a stranglehold on the Australian economy and Turnbull cannot afford to antagonise Beijing.

Australia needs other options and India needs to seize the opportunity. Half-hearted efforts by both sides have been made to strengthen ties and trade but there has been little to show so far. Prime Minister Modi made a beginning by visiting Australia in November 2014, being the first Indian PM to do so in 28 years. But much more needs to be done. It is indeed surprising that both countries have not come closer as they have common concerns. China’s assertive posturing in the South China Sea and its efforts to strengthen its military presence in the region impact both India and Australia’s security concerns. In fact, any sort of obstacles in free navigation of ships in the South China Sea region will directly impact Australia’s interests. This is because more than half of Australia’s iron ore and LNG exports take place through this region.

The US-China tariff war will have ripple effects on Australia given the fact that its economy is so dependent on China. This is where India needs to step in. Currently, a Comprehensive Economic Cooperation Agreement (CECA) is being looked at by the two countries but so far several rounds of negotiations so far have yielded little result. A report by the Australian government on the country’s economic strategy for India states, ‘Our negotiating positions on CECA are too far apart for the conclusion of a CECA to be a realistic objective in the near term.’ This is indeed a chance missed because the QUAD, should it take shape, needs its members to interact economically. India, Australia, US and Japan can only build mutual trust and co-operation through greater trade. India has succeeded to an extent with the US and Japan but a lackadaisical attitude has prevailed on both sides when it comes to an India-Australia relationship.

India needs to now shed its blinkers and move away from the UK, UK, China, and to an extent Russia, as the definers in its international relations. Both India and Australia attach value to the role of strengthening institutions such as ASEAN, the East Asia Summit process, and the early conclusion of a Regional Comprehensive Economic Partnership (RCEP) deal, in which both countries are partners. Clearly, apart from the ‘China threat’ there are more than enough reasons for the two countries to come closer together.

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